Special Report: America's unending hostage crisis with Iran

WASHINGTON, August 1 (Reuters) - A year before leaving office, Barack Obama stunned the world with a prisoner trade with Iran. After more than a year of secret negotiations, the U.S. president announced that five Americans were freed from captivity, closing a deal he dubbed a “one-time gesture.”

But even before Obama stepped down, American diplomats were back at the negotiating table, struggling to secure the release of more prisoners.

His successor, Donald Trump, blasted Obama as soft on Iran. As a candidate, Trump made a bold pledge on Iran’s prisoner taking: “This doesn’t happen if I’m president!”

Trump didn’t deliver. More than a year into his presidency, Iran still holds prisoner at least five U.S. citizens and permanent residents – including one taken during Trump’s tenure. The White House declined to comment, and the State Department said the United States works “tirelessly” to free Americans held in Iran.

His administration confronts a troubling reality: There is no easy way to stop Iran from taking Americans prisoner, a tactic Tehran has employed since the Islamic Revolution of 1979.

That year, Iran took 52 Americans hostage at the U.S. embassy in Tehran. Since then, it has detained at least 25 American citizens or permanent residents, Reuters found through interviews and a review of court documents and news reports.

Democratic and Republican administrations alike have struggled to find an effective response. From military strikes to placating Iran through arms sales and cash payments, U.S. presidents have employed force, diplomacy and persuasion. Each path has led only to more prisoners, concessions and tension.

“These are probably the hardest issues that I ever dealt with when I was at the White House working on Iran,” said Kelly Magsamen, a former National Security Council official who handled Iran during the Bush and Obama administrations. “The Iranians are quite adept at, essentially, hostage-taking.”

Iranians say the Americans have been held with just cause. “U.S. citizens that have been detained in Iran have been arrested for committing grave security and non-security related offenses,” said Alireza Miryousefi, a spokesman for Iran’s diplomatic mission to the United Nations.

Iran has detained not just Americans but also Europeans. A 2017 Reuters investigation found that the Revolutionary Guards had arrested at least 30 dual nationals in two years. One is Nazanin Zaghari-Ratcliffe, a British-Iranian aid worker employed by the Thomson Reuters Foundation, whose family and employer deny the charges against her. Another is Ahmadreza Djalali, a Swedish-Iranian scientist arrested in 2016 after attending a conference in Tehran.

For Washington, progress often comes with a catch. The prisoner trade negotiated by Obama contained elements all but ensuring future American concessions to Iran – including the likelihood of some combination of cash transfers and the release of more prisoners – and vexing questions about the captives left behind.

To understand America’s unending hostage crisis with Iran, Reuters interviewed 12 current and former U.S. and Iranian officials with direct knowledge of the prisoner cases, in addition to lawyers, family members and friends of American captives. These voices provide fresh insight into how the intricate negotiations unfolded – and into the path now being followed by Trump.

As part of the swap, Iran released the five Americans named by Obama – Washington Post reporter Jason Rezaian, Christian pastor Saeed Abedini, former U.S. Marine Amir Hekmati, businessman Nosratollah Khosravi and student Matthew Trevithick – and one Iranian-American whose release the White House kept secret at the time. In return, the Obama administration agreed to either free from jail or drop charges against seven Iranians in the United States. Those Iranians were almost all charged with or convicted of violating a U.S. trade embargo on Iran. Washington also agreed to drop charges against 14 Iranians living overseas.

A day after the prisoners were set free in January 2016, the United States announced it would release $1.7 billion to Iran, linked to a separate, long-running dispute over arms sales.

MISSING FBI AGENT, IMPRISONED BUSINESSMAN

The deal did not resolve the longest-running case: the disappearance of Bob Levinson, a former Federal Bureau of Investigation agent who vanished on Iran’s Kish Island in 2007 while on an intelligence mission.

The Obama administration also did not win the release of Siamak Namazi, an Iranian-American businessman seized by Iran in October 2015, just as diplomats were nearing a final deal over the other prisoners. Months later, Iran would capture Namazi’s ailing father, Baquer, after enticing him to return to Iran by promising a visit with his jailed son.

All told, in the year after the trade, Iran arrested at least another five American citizens and permanent residents.

The dynamic raises a question among family members and advocates for American prisoners: How did American negotiators seal a bargain with Tehran that excluded a former American government agent and an Iranian-American well connected in Washington?

The answer lies deep in the 2015 talks. The months-long negotiations sometimes pitted the competing interests of prisoners held by Iran against each other, in a drama that played out during Obama’s fraught effort to reach a nuclear agreement with Tehran.

Trump has opened the door to new talks, though they are now dormant. Yet any new prisoner deal between Iran and the Trump administration would have to resolve Levinson’s case, or risk the ire of U.S. law-enforcement agencies, said former U.S. negotiators. Most current and former U.S. officials who spoke to Reuters did so on condition of anonymity in order to discuss confidential negotiations.

The negotiations behind the 2016 deal began as a quest to recover Levinson, they said. For years the FBI has pushed for his release, even as Iran maintained it had no idea what happened to him. Washington believes Iran detained Levinson on Kish Island, 10 miles off the southern Iranian coast.

Wendy Sherman, then the number-three diplomat at the State Department, had launched secret negotiations in 2014 aimed at resolving the Levinson case and freeing the other captives. Brett McGurk, a senior State Department official, led the negotiations, which began in earnest in 2015.

By then, it had been years since definitive proof surfaced that Levinson was alive. Some State Department diplomats believed the United States should prioritize citizens they knew were alive, two former officials said. But negotiators faced pressure for answers from the FBI, lawmakers and the Levinson family.

Those dueling pressures – finding what happened to the missing agent, while working to free those imprisoned later but known to be alive – created another raft of complications in the negotiations.

For years, Levinson’s whereabouts were often a vital line of interrogation FBI agents pushed when questioning Iranian suspects about sanctions violations, even those who would have no obvious reason to know about his fate.

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“It’s like their first question when they come into the room: ‘Where’s Levinson?’” said a person with direct knowledge of the conversations.

The Iranians sent a team that included a representative from the Ministry of Intelligence. Typically, the United States only had access to Iran’s Ministry of Foreign Affairs. The involvement of this senior intelligence operative was kept a closely guarded secret and taken as a strong signal Iran was serious.

As talks progressed, the two nations began developing lists of prisoners each held in its jails, slowly feeling out what the other side would concede.

From the start, the United States was willing to consider trading even Iranian prisoners seen as threats to national security, so long as Iran released Levinson, returned his body, or provided conclusive information on his status. “We told the Iranians very clearly we would have a different conversation if Levinson was included,” a former diplomat said.

The Iranians responded with a startling offer. In return for Tehran’s assistance in recovering Levinson, they wanted Washington to reveal the location of Ali Reza Asgari, an Iranian general who vanished in Turkey in 2007, just one month before Levinson’s disappearance.

For the Americans, Asgari was a special case. In the 1980s, he held top leadership roles in Iran’s security and intelligence apparatus in Lebanon. That made him a crucial player in the establishment of Hezbollah, the Lebanese militant group that killed scores of American troops and civilians in bombings in Beirut. The United States has long denied involvement in Asgari’s disappearance.

U.S. diplomats approached the Central Intelligence Agency with this offer but were told American agents had no information on Asgari’s whereabouts. And without that, resolving Levinson’s disappearance was off the table.

“It became pretty clear pretty soon that this was not something [the Iranians] were prepared to budge on,” said the former U.S. negotiator. Iran continues to maintain it has no knowledge of Levinson’s whereabouts.

So, by late summer of 2015, U.S. negotiators had decided they would agree to a deal with Iran even without resolving the Levinson case.

On January 16, 2016, as Stephanie Curry, Bob’s daughter, was coaching her daughter’s basketball team in Dallas, she received dozens of text messages from family members: There had been a prisoner trade with Iran.

“Oh my gosh, my Dad has been released,” she recalled thinking. Then she learned the truth.

“I can’t even describe what that feeling was like for myself and the rest of my family,” she told Reuters.

‘IT’S ON TV’

That same day, 8,000 miles away, another family suffered the same sequence of elation, confusion and devastation. When news flashed that five Americans had been freed, Babak Namazi, a lawyer living in Dubai, called his parents: His brother Siamak was coming home, he told them.

“‘Are you sure?’” she asked, Babak recounted in a conversation with reporters last year.

“‘It’s on TV,’” he replied.

Over several harrowing hours, the family learned Siamak was not on the plane with the other Americans. He remains jailed in Iran to this day, and recently spent his 1,000th day in prison.

Siamak, now 46, had been arrested by Iran’s Islamic Revolutionary Guard Corps three months earlier and eventually charged with allegedly spying for the United States. For weeks, Babak had frantically shuttled between Dubai and Iran to press for his release.

In the 1990s and early 2000s, when Iran had a moderate, reform-oriented president in Mohammad Khatami, Namazi ran consultancies that advised foreign investors on doing business in Iran.

But in 2005, Mahmoud Ahmadinejad, a hardliner hostile to the West, was elected president. By 2007, Siamak left Iran, and largely spent those years living abroad. In 2009, during massive unrest in Iran, Bijan Khajehpour, Siamak’s business partner and relative by marriage, was accused of espionage and jailed for three months.

In 2013, Iranians elected the more moderate Hassan Rouhani as president. Expatriates and U.S. officials hoped his election would usher in detente with the West. Siamak received periodic warnings from associates that Iran was still too dangerous for dual citizens, especially those with global connections. Still, Rouhani’s election inspired hope that Siamak might be able to help his native country. In 2013, he authored a report documenting medical supply shortages in Iran as a result of Western sanctions.

He began organizing a May 2015 trip of the World Economic Forum’s Young Global Leaders to Tehran, coordinating the conference with senior Iranian officials, including Rouhani’s then-chief of staff, Mohammad Nahavandian. But after some participants were unable to obtain Iranian visas, Siamak abandoned the effort.

Soon after, he received a warning. An Iranian associate had been interrogated by security agents. In June 2015, that man told Siamak he had been questioned about their relationship and that it would be dangerous for him in Iran.

Siamak was undeterred. During a trip to Iran in July 2015, he was blocked from leaving the country, and over the next three months, was repeatedly interrogated. Finally, on October 13, 2015, he was arrested, and eventually convicted of “collusion with an enemy state,” referring to the United States.

The timing of his capture – just three months before the big prisoner trade – presented a problem for U.S. negotiators. They were nearing the end of complex talks on prisoner releases, the lifting of sanctions, cash settlements and limits on Iran’s nuclear program. So, the broad outlines of agreements between the two countries had already been set by the time Siamak was captured.

Two months later, in December, Iranian security forces took yet another prisoner – Matthew Trevithick, an American studying Persian in Tehran.

A month after Siamak’s arrest, in mid-November, State Department negotiator McGurk contacted Siamak’s relative and former business partner Khajehpour, and indicated a prisoner trade was possible. Did the family want Siamak to be in the deal?

The Namazi family’s account of their response to the State Department diverges from that of current and former U.S. officials who spoke to Reuters.

“We wanted Siamak to be included, and we didn’t even hesitate to ask for it,” Khajehpour said.

A U.S. official said Khajehpour told McGurk not to include Siamak in the deal, fearful that American involvement would harm their chances of gaining his release through their own connections in Iran.

Three current and former U.S. officials said the Namazi family eventually did ask to be part of the swap in the final hectic days of negotiations.

As the day of the swap drew near, U.S. negotiators asked Iranian Foreign Minister Javad Zarif to release Siamak and Trevithick as part of the prisoner trade. Zarif told then-Secretary of State John Kerry that Siamak could not be included, said former U.S. officials with direct involvement.

“We were given essentially a flat ‘no,’ that trying to include him in the deal would blow up the rest of the deal,” said a former U.S. official. “And that would have jeopardized the lives of the five other people coming out.”

The Iranians considered Trevithick a less serious case, in part because he did not hold Iranian citizenship, and released him hours before the other prisoners flew out of Iran.

The prisoner deal was negotiated separately from the nuclear agreement, under which Tehran accepted limits on its uranium enrichment program in exchange for the lifting of sanctions. Still, in some ways, the two were linked: Kerry used leverage from the nuclear deal and cash settlement to free the prisoners, a former State Department official said. And, had the prisoner deal collapsed at the last minute, it could have jeopardized the nuclear deal.

The stakes were high. Rezaian, Abedini and Hekmati each had been behind bars for extended periods – Hekmati for more than four years – sometimes undergoing solitary confinement and torture. Miryousefi, the Iranian U.N. mission spokesman, said U.S. citizens detained in Iran are “treated with humanitarian and Islamic considerations.”

Rather than demand Siamak’s release, Kerry accepted a pledge from Foreign Minister Zarif that he would be freed after the deal was done, former U.S. officials told Reuters. The officials disagree on whether Zarif gave a hard promise or simply said he’d try. But after nearly two years of talks, all viewed Iran’s chief diplomat as credible.

The same day as the prisoner trade, the United States lifted sanctions against Iran. The next day, Obama announced Washington had begun repayment to Iran of $1.7 billion to settle a decades-old dispute over an arms deal predating the 1979 Islamic Revolution.

The Namazi family believes Washington squandered leverage. In addition to the cash payment, the nuclear deal gave Iran access to about $100 billion that had been accumulating in foreign banks in payment for Iranian oil sales.

“You’re releasing a hundred billion dollars in unfrozen assets and hundreds of millions of dollars in cash, and you think you have leverage the day after you’ve done that?” asked family lawyer Jared Genser.

Kerry, through an aide, declined to comment on the specifics of the negotiation. But he “wishes everyone had the same outcome, and prays for the day every family will have the peace of mind they all deserve,” said Matthew Summers, the aide.

Instead of releasing Siamak Namazi, the Iranians arrested his ailing father, Baquer, a month later, while the now 81-year-old was in Tehran hoping to visit his son. The Iranians released Baquer home to his family several months ago.

STAFF TURNOVER, TRUMP’S CHALLENGES

As word of the swap blanketed cable news, one man declared his opposition: John Bolton, former U.S. ambassador to the United Nations and at the time a frequent television commentator on foreign policy.

The deal, he said, was “wonderful for the American hostages and their families” but a “diplomatic debacle” for the United States. “Are we simply incentivizing Iran to take further hostages?” he asked.

Bolton is now Trump’s national security advisor, in office since April. That makes him a central figure in deciding what concessions, if any, Washington will grant Iran in any prisoner exchanges. A spokesman for Bolton declined to make him available for an interview.

Despite Trump’s bellicose rhetoric toward Iran, the two countries have considered the possibility of a second prisoner swap, one U.S. official said. Miryousefi told Reuters there are 22 Iranian citizens held in the United States or abroad that it wants freed.

But after a series of false starts and diplomatic snubs, the Trump administration has embraced an approach of pressuring Iran, such as considering revoking the U.S. visas of family members of Iranian political elites.

Then, in May, Trump took a step that dimmed hopes for the U.S. citizens in Iranian captivity: He withdrew from the nuclear deal Obama had cemented, saying the pact had done nothing to stop Iran’s support for militant groups or involvement in conflicts across the Middle East.

On Monday, Trump said he would meet with Iran’s leaders “anytime they want” without preconditions, though senior Iranian officials rejected the offer, citing U.S. sanctions on Iran.

Miryousefi said an Iranian proposal to the United States to resolve the prisoner crisis went unanswered several months earlier. Now, with the United States having abandoned the nuclear pact, any negotiations over prisoners are impossible, he said.

During his first 16 months in office, Trump did not appoint anyone to the highest ranking post charged with winning the release of Americans imprisoned overseas, leaving the position to be filled on an acting basis by a career diplomat with little direct connection to the White House.

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Frequent personnel shifts at Trump’s White House and State Department have often left family members in the dark about who to meet with.

And of late, neither the United States nor Iran has expressed any serious intention to discuss the prisoners.